CLE Materials for Panel #1 - George Washington University Law ...

July 5, 2011
Unclear Whether Latest Preemption Developments
Create Clear Path or Muddy Waters for Federally
Chartered Banks
BY V. GERARD COMIZIO & HELEN Y. LEE
Recent pronouncements from the courts and the Office of the Comptroller of the Currency (“OCC”)
have begun to shed some light on what preemption for national banks and federal savings
associations will look like on and after July 21, 2011, the effective date of the preemption provisions of
Title X of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”). 1 In
Baptista v. JP Morgan Chase Bank, N.A., the 11 th Circuit upheld a pre-Dodd-Frank Act District Court
determination that a Florida statute limiting check-cashing fees does not apply to national banks. 2
One day later, the Acting Comptroller of the Currency wrote a letter to a member of Congress to
outline the agency’s interpretation of particular aspects of the preemption provisions of the Dodd-
Frank Act and the agency’s plans to amend its regulations to reflect such interpretation (the “May 12 th
OCC Letter”). 3 These events were closely followed by a notice of proposed rulemaking by the OCC
that sets those plans in motion (the “Preemption NPR”). 4 The comment deadline for the Preemption
NPR closed on June 27, 2011.
Public comments submitted in response to the Preemption NPR reflect viewpoints from industry,
government, trade and consumer groups that range from “you got it right” to “you got it all wrong,”
with respect to the OCC’s position on preemption as reflected in the proposed rules.
In particular, the U.S. Department of the Treasury (“U.S. Treasury Department”) submitted an
unprecedented comment letter raising a number of significant concerns about the Preemption NPR.
Further, the recent nomination of Thomas J. Curry, a former Massachusetts banking commissioner,
further muddies the waters for discerning federal policy in this important area. It remains to be seen
whether the U.S. Treasury Department’s letter and Curry’s nomination indicates that the Obama
Administration is looking for a Comptroller who takes a more favorable view of states’ rights when it
comes to banking regulation.
These latest developments are only the beginning of events that will continue to shape the preemption
landscape for federally chartered banks. It remains to be seen how the preemption provisions of the
Dodd-Frank Act may impact the interstate operations of federally chartered banks and what the OCC’s
implementing regulations for the preemption provisions of the Dodd-Frank Act will look like in final
form.
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